Roth IRAs are great for most middle-class earners for a few reasons:
- The maximum isn’t crazy high. The annual maximum contribution limit of $6,000 is just large enough to add up quickly over time but just small enough that — with some adjustments — most people can hit it.
- No taxes in retirement. Most people like the Roth because you pay the taxes upfront. So when it comes to your retirement years, you don’t have to worry about any taxes. The money you’ve saved in your account is 100% yours.
- This sure makes figuring out your retirement budget easy — you won’t need to worry about accounting for Uncle Sam’s cut. And knowing you can simply withdraw the money without having to fill out any more tax paperwork can be a load off your mind, as well.
- Easy to open. A Roth IRA is a basic retirement account you can find practically anywhere. Brokerages, companies, banks and credit unions offer these accounts. They’re very common, which means, for most people, they’re easy to open.
- In fact, you can even open up a Roth IRA online. I’ve opened two of these accounts, both entirely over the internet.